The NCDM Database Excellence Award Winners

Talk about strategic brilliance: Every one of the companies featured here devised a complex, data-driven solution for a marketing problem. And they’ve won the rarest of all marketing honors — an NCDM Database Excellence Award. There’s nothing subjective about the judging. Each entry is assessed by a panel of database experts and ranked according to strict criteria. Above all, the judges want to see results. These awards are presented every December at the NCDM conference run by Direct and the Direct Marketing Association. Are there are other vendors and clients that deserve to be listed? Sure. But there’s much to learn from the 10 presented in the following pages.

MULTICHANNEL MARKETING

Award: Platinum, Gold

Marketer: National Australia Bank

Vendor: Teradata

National Australia Bank decided a few years ago to decentralize. It gave control to local branches over staffing, business hours and marketing.

But the latter couldn’t be done without a proper CRM system, one that would provide users with analytics and event-driven triggers. So the bank, which has 8.3. million customers and $605 billion in assets, worked with Teradata to develop a program.

This led to a total marketing overhaul. But getting buy-in from potential users was no small task. As the entry form states, “We had to re-educate approximately 4,000 sales staff whose past experience included high volume, traditional product-focused marketing leads with low probability of success.”

Then there was the challenge of making it all work. The bank sought to:

• Involve bankers in creating event-driven triggers.

• Enhance and create sales tools per trigger requests.

• Create new channels and models for delivery of push and pull triggers. These included teller conversations, call center interactions and Internet banking.

• Increase return on investment.

Teradata also devised online reporting mechanisms like the Banker Dashboard. It helps the sales force track results, and provides custom reports. One is on the cross-sell opportunities in each portfolio.

Local branches can now log on to select up 40 different trigger types, which are delivered the next day to Siebel screens. Triggers might occur when the customer:

• Does something out of character, like making a large transaction.

• Has a product/service nearing maturity, such as a fixed rate home loan.

• Shows a sudden change in spending habits — say, by purchasing baby products.

But the triggers are also designed to stimulate a conversation and uncover specific needs. Instead of calling their banker, for example, the customer might call the bank’s contact center to request a statement on their home loan. This could signify that they are looking to refinance their loan. The lead is sent to the bank’s mortgage retention unit.

The results?

• The bank is now consistently above its target of generating “1,000 unique opportunities per week.”

• It reached 75% of its dollar-value goal within three months, and is now running 66% above target.

• It surpassed by 150% its goal of having half of its bankers requests its new sales tool.

The Database Excellence Awards judges call this a success.

“The dashboard allows bankers to monitor their effectiveness and follow up with customers,” one writes.

Another adds that “the project exhibits forward thinking and sophistication not seen in most marketing systems. By enabling the user to customize which triggers are important, they essentially have a customized system for themselves.”

Award: Silver

Marketer: Merchants Bonding Co.

Vendor: Relationship Marketing Inc.

How’s this for an assignment? Merchants Bonding Co., an insurance provider that offers contract and commercial surety bonds, wanted to engage its top agents, those who provide 90% of its revenue. But how?

The answer was an integrated marketing plan.

The firm’s vendor, Relationship Marketing Inc., started by analyzing several years of transactions. The purpose: To understand behavioral trends.

Based on this analysis, it grouped agents (or customers) into three primary subsets: steadies, up and comers, and faders.

Phone interviews established that the top agents needed marketing and educational tools. So Merchants Bonding launched an interactive forum where agents and industry surety experts share their expertise. The program, called The Leaderboard, “taps into “the agents’ sense of competition and elite accomplishment,” the company says.

The Leaderboard was launched with an introductory Flash presentation and a benchmark satisfaction survey. The tagline for the effort: “Best Practices for Best Results.”

As part of this, Merchants Bonding sends a personalized e-mail newsletter called the Forecast. Underwriters are able to create custom hard-copy versions in magazine format. And there are many special mailings.

The firm also set production goals for all customers using the Leaderboard. Thanks to regular predictive analytic reviews, it can identify agents who are up and coming or fading.

Agents are also segmented by loyalty, transactions, future potential, geography, rate of change and roughly 15 other predictive variables.

Some underwriters were reluctant to support the marketing effort. But they apparently warmed up to it.

The best testimonials for the active three-year program came from the agents themselves.

“An innovative idea,” said one. “The consistent contact reminds me to think of Merchants and that is helpful since you don’t have a physical office here.”

Another wrote, “It projected the message of your desire to be your agents’ partner. I would not normally spend that much time on a general message. Thanks for your support.”

Award: Bronze

Marketer: Alltel Wireless

Vendor: Acxiom

Alltel Wireless would seem to be at a disadvantage. Far from being the top wireless carrier in the United States, it’s No. 5.

But that’s not shabby, given that it holds the top slot in some places, and that it has 13 million customers in 35 states. And its My Circle product, featuring free unlimited calling to any 10 numbers, is a brand differentiator, it claims.

So why did Alltel hire Acxiom? Because it needed a “robust, centralized, data-focused marketing solution.” That meant automated customer communications and advanced analytics.

This was a serious undertaking, for the firm counts on “successful marketing strategies to maintain and improve its market position,” it says.

The obstacles to this agenda? That Alltel had siloed customer data sources and limited prospecting information. In addition, it lacked an automated customer lifestyle management system.

But that has changed. Alltel now has faster predictive modeling, thanks to best-of-breed campaign management tools and an Oracle database customized by Acxiom.

In addition, it has combined Acxiom’s data with its own to do better behavioral targeting.

Alltel’s direct marketing team now conducts more than 300 initiatives per year, using direct mail, e-mail, outbound voice and text messaging. Many of these campaigns are automated.

The firm now sends 285% customer communications than it did before, based on a deeper understanding of what subscribers need, and at different times in the life cycle.

Meanwhile, its take rate for My Circle campaigns to existing customers now tops 6%.

TECHNOLOGICAL APPLICATIONS

Award: Gold

Marketer: Nissan North America

Vendor: The Marketing Store

Nissan North America had a classic challenge. How could it help its dealers sell parts and services in a competitive market?

The answer was a customer data mining tool that would enable these sellers to create lists, and then conduct e-mail, mail, text and phone campaigns.

Of course, there was more to it than that. The tool had to facilitate profiling, analysis and modeling, among other things. It had to serve the front office. And it had to generate quick reports.

Above all, it had to identify owners of new and used Nissan/Infiniti vehicles.

Nissan worked with its loyalty marketing vendor The Marketing Store to handle this complex project.

First, Nissan had to demonstrate strong sense of buy-in from the top down. And it had to persuade the dealers to participate.

Then there were the technical issues. The firm had to pull — and standardize — data from multiple sources. And it had to construct a database to house all of it.

The technical work proceeded. So did the marketing to the end users.

The company created a promotional video that it showed to dealers at an annual Road Show. It also sent teaser e-mails, conducted Webinars and developed training guides. And it made follow-up phone calls.

The tool was deployed in February 2007. And it quickly generated results. Over 98% of the end-users used the tool at least once in the first eight months, with an average of 5.9 quick reports run per dealership per month.

As the Marketing Store states in its entry form, “The tool gives dealerships unlimited access to their entire database of customers.” It also provides them with quick reports to “help drill into key subsets of the database.”

Above all, the tool has “generated additional revenue by helping attract more customers to the service departments of the dealership network.” The company now plans to further develop the tool. ?D

Award: Silver

Marketer: Progressive Enterprises Ltd.

Vendor: Proximity iD Ltd.

New Zealand was home to one of the top digital programs of 2008. Progressive Enterprises, owner of three national supermarket chains, launched its Onecard super Email Platform, a tool for sending relevant messages to shoppers.

Put together by Proximity iD Ltd., the system has many complex elements. For one thing, it contains a content management system into which thousands of product specials are loaded every week. It also includes an audience selection tool based on variables like the price points that a customer tends to shop for in a product category, and whether the household seeks discounts. Then there’s the so-called analytics factory, which performs complex calculations and “aggregations on the 1 billion transactional rows of raw data.”

E-mail isn’t the only channel. The system is also designed to serve shoppers on the Web, and via SMS.

The results? Onecard is now “one of the largest supermarket databases in New Zealand,” the company says. It covers 65% of all spending by nearly half of the New Zealand population. It also succeeded in reducing the cost of doing business.

ANALYTICS & MODELING APPLICATIONS

Award: Gold

Marketer and Client: Cisco Systems

When information technology marketer Cisco Systems sought to boost its fortunes through its analytic capabilities, it went to war.

More specifically, it went to WAR — it sought Wallet share improvement, Acquisition and Retention. (That’s Cisco’s acronym.) The objective was to generate $1 billion in incremental revenue by applying business intelligence to its sales and marketing functions.

Cisco launched this effort by consolidating its data querying process. Its systems had been slowed down by the large number of users running marketing scenarios, some of which were either irrelevant to or — worse still — redundant. The company hoped to cut processing time and ensure that all relevant departments would be working off the same set of data and analytics.

The firm also revamped its modeling. Several were designed to identify current customers who were most likely to purchase one of its main products within two quarters.

This activity required the creation of 1,400 models. The process resulted in leads — Cisco identified candidates for technology upgrades and complimentary hardware.

The company ran another 700 models to recognize prospects. These were applied to all companies listed by Dun & Bradstreet within the 70 countries Cisco determined made up its most important markets. The analysis incorporated data on each company’s vertical and sub-vertical activities, number of employees, annual sales and other information.

This was harder than it sounds: In many cases, the quality of available company data varied greatly by company, and in some instances was insufficient for modeling purposes. Cisco constructed a series of imputation models to fill in the blanks.

Once Cisco determined who its prospects were, it grouped companies into segments based on how they would react to the four Ps of marketing (product, price, placement and promotion). This model also defined the best communication channels and messages.

Using its 2002 sales as a baseline, the firm pursued three goals: upselling a certain technology to purchasers of an earlier version; cross-selling to those who had made a related purchase after 2002; and acquiring customers that had not made a purchase from Cisco since 2002.

Was it smooth sailing all the way through? Not exactly. Cisco had to cope with a wide variety of applications that supported marketing and sales functions, and its data points required standardization. By its own admission, it was difficult to incorporate scores, clusters and estimates and took longer than expected.

There was human resistance as well: Cisco had to offer several rounds of education and training before the new systems were fully adopted.

The analyses and lead generation and ranking fed sales through multiple channels — by telephone, direct mail, e-mail marketing and event marketing — and through representatives. And they will continue to feed them. Why not, given the 370% lift a test panel of the highest-scoring prospects scored over a randomly chosen control panel?

The models have also yielded a variety of important lessons. Cisco can now map likely next purchases based on initial transactions. It also has a better handle on the mathematical relationship between customer loyalty and future revenue, as well as product defects and future revenue. The company has incorporated these learnings into its sales force training, and also uses them to improve development of Cisco products.

The ultimate metric? During the first 12 months of this new program, Cisco estimates it has generated an additional $940 million in additional bookings.

Award: Silver

Marketer: Valvoline

Vendor: Catalyst direct

Catalyst Direct, Inc. was retained by Valvoline Instant Oil Change to develop the relationships that they had with their customers as well as make a substantive, measurable and profitable impact on car count, which is measured by number of oil changes performed per day. In the quick lube industry, the ability to increase oil changes per day over the course of a year translates into substantial growth in revenue.

An important part of their strategy included identifying the approach that would drive the greatest incremental lift over a no mail population established as a control. A modeled approach was developed to drive those incremental results.

The key to success in the program was their ability to organize and compile our customer data, leverage the data to drive message and timing of direct mail, refining our approach along the way.

Award: Bronze

Marketer: Charter Communications

Vendor: Allant Group

Charter Communications offers cable services to 5.7 million customers across 29 states. And it relies on targeted direct communications rather than mass media.

But the company realized two years ago that its technical and data infrastructure was incapable of supporting its marketing. So it decided to consolidate its direct marketing operation and set a 24-week deadline for doing it.

The goal was to generate a new set of testing and models designed to boost its response rates, while reducing its expenses. The system would have to incorporate extremely granular data and provide predictive analytics accessible to both the marketing team and C-level executives.

The company has realized double-digit percentage gains in its prospecting response rates. Additionally, it has reduced costs by 17% for the 100-million-plus direct mail pieces it sends each year.

B-TO-B MARKETING

Award: Gold

Marketer: Michelin North America

Vendor: Datacore Marketing

Michelin North America is a classic business-to-business-to-customer marketer — that is, it relies on intermediaries to sell its products to the consumer. And that takes a special kind of marketing savvy.

Michelin stimulates — and tracks sales–through its Alliance Associate Dealer incentive program (AAD). This relies on the eStatement, an online application developed by Datacore Marketing.

The eStatement is updated daily, and provides both month-to-date and year-to-date account information — on everything from purchases to rewards. It is customized for each dealer based on purchase commitments.

Another application enables distributors, dealers and Michelin to execute legal contracts online. The parties can review terms and approve them with electronic signatures.

Roughly 70% of Michelin’s dealers buy from the company, the rest from distributors.

AAD is fueled by Michelin’s marketing database, also developed by Datacore.

Michelin uses the database to help dealers understand which programs they are eligible for — i.e., rebates, loyalty marketing and co-op funds.

It also tells how much money they earn from a given program; and when they will receive payment. In turn, Michelin can quickly access information regarding which dealers are using each program and how the programs are performing.

Michelin launched AAD via a series of local dealer events, and supports it through public relations campaigns that generate coverage in trade publications such as Modern Tire Dealer. It also sends e-mail updates to its dealer and distributor customer base.

The program has moved Michelin from needing to rely on distributor reports on dealer activity. It provides much more transparency for the firm, and allows the manufacturer to oversee benefit distribution to dealers.

Sales data is not yet available, but dealers have been signing up for AAD at a rate of more than 100 per month in 2008, up from 50 per month in 2007. Web site traffic has grown from an average of 100 dealers logging in every month to 10,000 doing so. And for the first time, Michelin is able to set benchmarks in products sold by the distributors to the dealer channel.

Award: Bronze

Marketer: Alvion

Vendor: Sybase

Alvion Technologies is an online list rental fulfillment provider. The company was recently acquired by Acxiom, which wanted to establish a system that would allow clients to search for prospects based on geography, demographics and other attributes.

But time was of the essence — the firm had to move from query to closed sale within minutes.

The challenge lay in generating a program that would support massive data files and provide analytics and query results without generating overhead expenses.

To accomplish this, Alvion and Sybase used a loading script that selects the fields, elements and attributes necessary to address queries. Customer requests are run on sets of data that contain only information necessary to satisfy each query.

This design has significantly reduced processing time. The process uses Sybase IQ software, which contains compression algorithms that reduce storage demands.

The benefits have been multifold. Query-to-delivery time has dropped to an average of six minutes. This is significant in a market where speed is considered a competitive advantage.

In addition, the system can accommodate four times its current usage level, with room to grow beyond that. And data-load times were cut by 50%.

The NCDM Database Excellence Awards call for entries begins in September. Check for details later this year at www.ncdmevents.com.